Bankruptcy Filings Down In November 2020
Bankruptcy filings increase during times of high unemployment. This is the first time in history that bankruptcy filings have decreased with the increase in unemployment caused by COVID19. There were 3,200 chapter 7 bankruptcy filings in Connecticut in November, 2020. That figure is 33% less than Chapter 7 cases filed in November of 2019.
Arkansas, Alabama, Nevada, and Tennesee have the highest per capita filings, with 3-4 people per 1000 filing for personal bankruptcy. Connecticut, Maine, Alaska, Montana, North Carolina, New Hampshire and New York have some of the lowest per capita filings, with under one person per 1000 filing for personal bankruptcy.
Some economists are predicting a surge in bankruptcies after cities and states reopen after the pandemic, and employment takes time to rebound. Mortgage delinquencies have gone up, but banks have offered forbearance agreements, which have given borrowers breathing room. The fact that most courts are closed has prevented banks from filing foreclosure cases.
Chapter 11 business bankruptcy filings are also significantly down from 2019. Chapter 11 allows a business to restructure its debts in order to pay off its secured creditors. Many businesses must have have been forced to shut down, and liquidate due to COVID19 and never bothered to file a Chapter 11.
If you wish to discuss bankruptcy, and whether bankruptcy would be a good option for you, please call our office and speak with a member of our staff at 2037724848. We cannot give you legal advice over the telephone, but we may be able to help you understand your various options.